Continued Finance and Business Optimism Drives UK Jobs Confidence Higher

Manpower Employment Outlook Survey Q4 2004
- Highest overall employer confidence since 2001;
- UK confidence strongest in Europe

Hiring confidence amongst UK employers in the Finance and Business Services sector continues to grow with these employers reporting their highest optimism at any time since 1998. This growing confidence has helped drive UK job prospects to a Net Employment Outlook of 18% - the highest national outlook since the end of 2001. In addition, the UK is also posting the most positive outlook of any of the European countries surveyed.

Hazel Detsiny, director at Manpower, says: In spite of increases to interest rates and concerns about the future of the housing market, companies remain confident about their future hiring intentions. The continued upturn is clearly evidenced through the growing confidence amongst employers in the City and business sectors where 23% of employers are looking to increase their headcount. At the same time, confidence is evident in other non-service based industries such as the manufacturing sector where jobs confidence has hit a seven-year high.

The Manpower Employment Outlook Survey measures employer hiring intentions for the quarter ahead: October to December 2004. 2,500 UK employers were surveyed in the UK and over 35,000 employers in 19 countries and territories globally. The Net Employment Outlook for the UK in Q4 is 18%. When seasonal variations are taken into account, the outlook is 14%.

Looking at the figures in more depth, the positive situation in the Financial Services sub-sector is reinforced by the fact that just two percent of employers are looking to cut back their workforce in the next quarter with 18 percent of employers looking to take on more staff. This is also the highest outlook for this sector in Europe. Confidence is also apparent in the Hotel and Retail sector where an Net Employment Outlook of
17% is the highest recorded outlook since the end of 2001 and
represents an
increase of 10 percentage points over the last year at this time.

Employer hiring intentions have generally been stable since the start of 2002 with no sign of the peaks and troughs of the mid-late 1990s, continues Detsiny. These results indicate that companies have confidence to hire staff and that job seekers are happy to move jobs. As opposed to new job creation, we are seeing a higher churn of workers in the labour market moving from company to company. With low wage inflation, employers are having to review the benefits they offer such as flexible working, training, pensions and healthcare to hold onto the best people.

Across the UK, eight of the nine industry sectors surveyed by Manpower are
planning to take on staff next quarter. Employers in Transport and
Communications; Finance and Business Services; and Manufacturing, all reported figures above the national average. The Agriculture sector is the only sector to expect cutbacks with a Net Employment Outlook of -8% - a decline of nine percentage points over the last quarter and a year-on-year decrease of four percentage points.

Employers in all twelve of the regions surveyed intend to take on more staff in the quarter ahead. Employers in the South West are the most optimistic with 32% of employers looking to expand their workforce. Conversely, employers in the West Midlands, London and Scotland are the least
optimistic: all three regions are reporting a Net Employment Outlook of 8%.

Of the 11 European countries surveyed, all but Germany (-2%) and Italy (-1%) recorded positive hiring intentions. The strongest outlooks in Europe are reported in the UK followed by Ireland ( 14%), Sweden ( 9%), Norway ( 7%) and Belgium ( 7%).

Looking at the results from a global level, 17 of the 19 countries and territories surveyed by Manpower anticipate positive Net Employment Outlooks for the three months ahead. New Zealand ( 29%) and Hong Kong ( 25%) report the most buoyant forecasts. Employers in 14 of the 19 countries expect more hiring compared to this time last year.